The Governor of the Bank of Ghana, Dr. Johnson Asiama, has cautioned that escalating tensions in the Middle East could threaten Ghana’s disinflation gains, even as domestic macroeconomic indicators show improvement.
Speaking at the opening of the 129th Monetary Policy Committee (MPC) meeting, Dr. Asiama noted that the evolving geopolitical situation is likely to influence the central bank’s policy considerations in the coming days.
He highlighted that the conflict in the Middle East is disrupting key energy and shipping routes, causing volatility in global oil markets and adding uncertainty to the trajectory of international inflation.
Rising oil prices, he explained, could feed into domestic inflation through higher import costs. “For Ghana, the transmission channels are clear. Sustained oil price increases could raise the risk of imported inflation and could also tighten global financial conditions,” he said.
At the same time, Dr. Asiama pointed out that geopolitical instability could support gold prices, which may benefit Ghana’s trade balance. Nevertheless, he stressed that the net effect of the external shock leans toward inflationary pressures.
The Governor also noted that Ghana’s current inflation rate of 3.3% has fallen below the central bank’s target band, presenting a new policy challenge for the MPC. He emphasized the need to carefully evaluate how the current policy stance interacts with ongoing macroeconomic trends, especially as credit activity begins to recover.
Another key discussion point at the MPC meeting is the government’s Ghana Accelerated National Reserve Accumulation Programme (GANRAP), which aims to raise external reserves to cover 50 months of imports by 2028, up from the current 5.8 months. While stronger reserves would enhance macroeconomic resilience, Dr. Asiama noted that the programme also has implications for liquidity, the central bank’s balance sheet, and monetary policy operations.
Regarding the banking sector, he observed that Ghana’s financial institutions remain stable, profitable, and well-capitalized, with asset quality improving. However, credit growth is subdued, and the MPC will assess whether this reflects supply-side constraints, risk appetite, capital buffers, non-performing loans, or weak borrower demand.
Dr. Asiama concluded that although Ghana’s domestic indicators have strengthened, the central bank must carefully weigh domestic progress against global uncertainties. “We must make our decision at the intersection of domestic success and growing external uncertainty,” he said.
The 129th MPC meeting is set to review inflation trends, macroeconomic developments, and global events ahead of the Bank of Ghana’s next Monetary Policy Rate announcement on Wednesday, 18 March 2026.